Quota system (Renewable portfolio standards)
Updated: 09.01.2019
Author: Krzysztof Ignaciuk
Plant operators generating electricity using renewable energy sources receive one Green Certificate (certificate of origin) per 1 MWh of generated electricity.
The Energy Law obliges some industrial customers, electricity generators, electricity suppliers, end-users who are members of the commodity exchange, commodity brokerage houses or brokerage houses to meet a certain quota of green certificates (certificates of origin) (Art. 9a.1 No. 1 Energy Law). As an alternative, the companies may pay a substitution fee (Art. 9a.1 No. 2 Energy Law). Satisfying neither of these obligations results in a penalty (Art. 56.1 No. 1a Energy Law).
Electricity producers may also sell their electricity on the market or offer it to an electricity supplier at last quarter's market price.
The quota system applies to installations launched before 1 July 2016. Their operators can choose between the quota system and migrating to the tender system. Furthermore, there will be a feed-in tariff for installations with the capacity between 3 kW and 10 kW.
Eligible technologies
In general, all technologies are eligible (§ 6 par. 1 No. 1 Order of 5/5/2014).
| Wind energy | Eligible. |
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| Solar energy | Eligible. |
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| Geothermal energy | Eligible. |
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| Biogas | Eligible. |
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| Hydro-power | Eligible under 5 MW (RES-Act, Art. 44.11) |
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| Biomass | Eligible, if the following requirements are met: - In plants whose capacity exceeds 5 MW and 20 MW, the amount of biomass shall exceed a certain percentage if substances other than biomass are co-fired (§ 6 par. 2 and 3 Order of 5/5/2014).
- In plants whose capacity exceeds 20 MW and which combust biomass only, a certain percentage of the biomass shall be of a certain origin (§ 6 par. 4 Order of 5/5/2014).
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Amount
| Amount of quota and period of application | The quota is a percentage of the total annual amount of electricity sold (§ 1.1 of Order of 5/5/2014). The quota has been fixed until 2021 and amounts to: Year | Quota |
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2016 | 15% | 2017 | 16% | 2018 | 17% | 2019 | 18% | 2020 | 19% | 2021 | 20% |
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| Adjustment of quotas | The Minister of Energy presents to the European Commission a report evaluating the progress achieved in the share of total produced electric energy constituted by electric energy produced in high effective cogeneration (Art. 9n Energy Law). |
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| Number of certificates according to technology | The quota does not depend on the technology used, and each technology is eligible for the same amount of certificates for the same amount of energy. |
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| Minimum price per certificate | There is no minimum price per certificate. |
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| Fees and penalty charges | Substitution fee. The quota obligation may also be fulfilled by paying the substitution fee (Art. 9a.1 No. 2 Energy Law). As of August 2017, the substitution fee amounts to 125% of the average certificate price from the year before but no more than 300.03 zł/MWh (69.85 EUR).
Penalty charges. If a generator fails to present certificates of origin or does not pay the fee, the regulatory authority URE charges a penalty (Art. 56 par. 1 and par. 2 Energy Law). The amount of penalty must exceed a certain amount calculated according to a specified formula (Art. 56 par. 2 No. 2a-d Energy Law). |
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| Annual average certificate price | 38.83 zł/MWh (approx. 9.04 EUR/MWh) in 2017 |
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Addressees
Obliged parties. Following parties are obliged to comply with the quota obligation:
- Industrial customers, which in the calendar year preceding the year of the obligation consumed at least 100 GWh of electricity (Art. 9a par. 2 No. 1 Energy Law)
- Energy companies producing or selling electricity to end users (Art. 9a par. 2 No. 2 Energy Law)
- End-users who are members of the commodity exchange (Art. 9a par. 2 No. 3 Energy Law)
- Commodity brokerage houses or brokerage houses (Art. 9a par. 2 No. 4 Energy Law)
Furthermore, electricity suppliers licensed to supply electricity to households that have not chosen a supplier are obliged to purchase electricity from renewable sources from producers within their area of service at a fixed price (Art. 9v Energy Law). The fixed price is the mean electricity price of the previous quarter.
Procedure
Process flow | Submission of certificates of origin/ green certificates. In order to provide evidence for the fulfilment of the quota, companies shall present certificates of origin/ green certificates (Art. 9a par. 1 No. 1, Art. 9e Energy Law). The regulatory authority awards these certificates for electricity from renewable energy to the plant operators (Art. 9e par. 3 Energy Law). Certificates of origin are transferable (Art. 9e par. 6 Energy Law) and may either be acquired by generating electricity from renewable energy or by purchasing them from other producers. Payment of a fee. The quota obligation may also be fulfilled by paying a fee (Art. 9a par. 1 No. 2 Energy Law). Penalty charge. If a company fails to present certificates of origin/ green certificates or does not pay the fee, the regulatory authority URE charges a penalty (Art. 56 par. 1 and par. 2 Energy Law). |
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Competent authority | Regulatory authority URE monitors compliance with the quota obligation (Art. 23 par. 2 No. 4 Energy Law). |
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International applicability
| International certificate trade | The Act does not stipulate that certificates can be traded internationally. |
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Distribution of costs
| Consumers | The costs of the quota system are borne by the consumers (§ 17 Order of 18/10/2012). |
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| Distribution mechanism | The costs of purchasing certificates of origin/green certificates and of paying the fee are included in the electricity price and thus, are equally distributed among final consumers (§ 17 par. 1 Order of 18/10/2012). |
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